Canada Clears ABMD's Impella cVAD
Massachusetts-based heart support technologies major, Abiomed Inc. (ABMD) has received the Health Canada nod to launch its Impella cVAD heart pump. Per the approval, the Impella cVAD can be used as a support system in cardiac surgery and cardiology for up to 5 days. With the Canadian launch of the product, the company will be able to further expand its presence in the international medical devices market.
The Impella cVAD is an intracardiac catheter-based pump, which provides circulatory support to the left ventricle of the heart. The device can pump up to 4 liters of blood in one minute. This renders flexibility to doctors to increase the flow for patients in need of more hemodynamic support.
Abiomed is enjoying strong demand for its Impella products. Impella utilization continues to grow at a healthy pace as evident from the increasing number of patients being treated with the device. The Impella cVAD, the latest addition to the Impella family, is expected to be accretive to the company’s revenues in the near term.
Abiomed’s revenues soared 31% year over year to $37.3 million (a quarterly record) in the fourth quarter of 2012. Growth was led by solid sales of Impella heart pumps. Globally, Impella sales rose 43% year over year to $32.3 million in the reported quarter.
Impella sales in the U.S. spiked 44% to $29.9 million. Also, Abiomed announced the first successful human use of its percutaneous Impella cVAD heart pump outside the U.S. in the fourth quarter.
Abiomed announced, in April, CE Mark approval for its Impella cVAD in the European Union. It is expected to become commercially available in Europe in early fiscal 2013. However, the Impella cVAD is not commercially available in the U.S. The company expects to receive 510(k) approval for the product by the second half of fiscal 2013.
While we are upbeat about the prospects of Impella, we remain cautious about the intensely competitive environment and reimbursement risks. Abiomed faces competition from organizations developing permanent heart assist products such as ThoratecCorporation (THOR).
We currently have a long-term Outperform rating on Abiomed. The stock holds a short-term Zacks #3 Rank (Hold).
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